VENTURE CAPITAL
  Number of
Deals		 Amount Invested
(in billions)
2006    
Q2 619 $6.7
Q1 594 $6.2
2005    
Q4 633 $5.8
Q3 587 $6.1
Q2 524 $5.4
Q1 474 $4.6
2004    
Q4 603 $5.4
Q3 526 $5.1
Q2 629 $6.0
Q1 535 $5.6
2003    
Q4 625 $5.7
Q3 519 $4.9
Q2 522 $4.5
Q1 527 $4.5
2002    
Q4 546 $5.0
Q3 583 $4.7
Q2 656 $6.4
Q1 617 $5.9

Source: Dow Jones VentureOne/Ernst & Young LLP

Hedging Their Bets


Venture capitalists invested $6.7 billion in startup companies in the second quarter. That was the highest amount since 2001 and the third consecutive increase. That may be good news for the more mature companies that accounted for almost half that money, but it means less is being devoted to early-stage businesses. Sure, newer startups carry a higher rate of risk, but they can also hold greater potential for innovation and market disruption.

Another trend worth noting: investments in the alternative energy sector are surging. Fifteen such startups raised $239 million in the second quarter, up almost fourfold from a year earlier.

Posted: 8/24/06


Also see:

NEA's Even Bigger Thinking


Wait a Minute...